Showing posts with label Irish core retail sales. Show all posts
Showing posts with label Irish core retail sales. Show all posts

Monday, June 9, 2014

9/6/2014: ESRI Consumer Confidence Indicator Moderates in May


Some hopium going out of the market in Ireland: ESRI Consumer confidence for May moderated from sky-high 87.2 in April to 79.4 in May, bringing the series slightly closer to reality mapped by Retail Sales data on the ground:


3mo MA for the series is now at 83.2, virtually flat on 3mo MA through February 2014, and on 6mo MA of 83.3. In other words, the series trending flat over 6 months, and are sitting at still sky-high levels. Meanwhile, volumes of retail trade (core, ex-motors) are rising along a decent trend, but value of retail sales is showing barely perceptible upward momentum.

Note, seasonally, for May, there is no established momentum in the series either up or down.

Thursday, June 28, 2012

28/6/2012: Retail Sector Activity Index for May 2012

Updating my own Retail Sector Activity Index for May 2012 on the foot of the latest CSO data:



Courtesy of the ESRI Consumer Confidence Index staying above 60 in May (the index dipped from 62.5 in April to 61 in May, marking the third consecutive month of readings above 60 despite continued gloom in actual retail sales), my overall Retail Sector Activity Index - a forward-looking indicator for the sector - remained relatively flat at 108.2 against 108.4 in May despite rises, m/m in core retail sales in volume (98.4 in April to 99.2 in May) and value (95.5 in April to 96.2 in May) terms.


It is perhaps interesting to note in the data in the first chart above that according to the ESRI surveys, Irish consumers do not lack any confidence. In fact, they appear to be lacking realism. Current 6mo average of the ESRI index reads 57.8 which is actually above the previous 6mo average of 57.5. One has to assume things had improved in the latest six months period on previous six months, alas both retail sales volumes (remained flat) and values (declined) do not confirm this. Year on year, Consumer Confidence is up 2.7% while core sales are up only 1.6% in value and just 0.8% in volume.

28/6/2012: Retail Sales for May 2012

The retail sales figures for May are out and are, as expected, not pretty.


The volume of retail sales (i.e. ex-price effects) decreased by 0.1% in May 2012 m/m and there was an annual decrease of 2.1%. The value of retail sales decreased by 0.4% in May 2012 when compared with April 2012 and there was an annual change of –1.5%. 



Relative to annual peak, sales are now down to 72.9% in value terms and 77.9% in volume terms. Relative to monthly peak, they are down 25.6% in value and 19.8% in volume.


We have now gone two consecutive months of m/m declines in value and volume and five consecutive months of y/y declines. Both 3mo and 6mo MA for value and volume indices are ahead of May reading. For value index, 2012 average to-date is 87.28, which is below 2010 average of 88.83 and 2011 average of 88.15. For volume, current 2012 average to-date is 91.02, which is worse than 2011 average of 92.69 and 2010 average of 93.51.

Quarterly movements are shown below:



On core retail sales side (ex-motors), the volume of retail sales increased by 0.8% in May 2012 when compared with April 2012, while there was also an annual increase of 0.8%. There was a monthly increase of 0.7% in the value of retail sales and an annual increase of 1.5%. Value increase is less significant than volume increase, so we are still witnessing margins pressures. Survival of the fittest in the sector is not yet completed.


May marked the first month of core retail sales increase in annual terms since December 2011 in value and volume. Currently, value index is running at 81.11% of the annual peak and volume index is at 84.79% of the series annual peak. However, in value terms the 2012 average to-date (95.7) is slightly ahead of 2011 average of 95.6 and is below 2010 average of 97.6. In volume terms, 2012 average to-date is 98.8, which is lower than 2011 average of 99.8 and 2010 average of 102.7.


Per CSO: The sectors with the largest month on month volume decreases are Bars (-4.2%), Books, Newspapers and Stationery (-2.8%), Electrical Goods (-2.5%) and Motor Trade (-1.9%). A monthly increase was seen in Food, Beverages & Tobacco (6.5%), Hardware, Paints & Glass (6.3%) and Pharmaceuticals Medical & Cosmetic Articles (3.8%). Pills, booze, smokes... hopefully not paint for inhalation purposes.



International comparatives through April are shown above. Not a pretty sights across the board.

Thursday, March 8, 2012

8/3/2012: Economy on a flat-line: Sunday Times 4/3/2012


This is an unedited version of my article in Sunday Times March 4, 2012.



This week, the conflicting news from the world’s largest economy – the US, have shown once again the problems inherent in economic forecasting. Even a giant economy is capable of succumbing to volatility while searching to establish a new or confirm an old trend. The US economy is currently undergoing this process that, it is hoped, is pointing to the reversal in the growth trend to the upside in the near future. The crucial point, however, when it comes to our own economy, is that even in the US economy the time around re-testing of the previously set trend makes short-term data a highly imperfect indicator of the economic direction.

In contrast to the US economy, however, Irish data currently bears little indication that we are turning the proverbial corner on growth. It is, however, starting to show the volatility that can be consistent with some economic soul-searching in months ahead. Majority of Irish economic indicators have now been bouncing for 6 to 12 months along the relatively flat or only gently declining trend. Some commentators suggest that this is a sign of the upcoming turnaround in our economic fortunes. Others have pointed to the uniform downward revisions of the forecasts for Irish growth for 2012 by international and domestic economists as a sign that the flattening trend might break into a renewed slowdown. In reality, all of these conjectures are at the very best educated guesswork, for our economy is simply too volatile and the current times are too uncertain to provide grounds for a more ‘scientific’ approach to forecasting.

Which means that to discern the potential direction for the economy in months ahead, we are left with nothing better than look at the signals from the more transparent, real economy-linked activities such as monthly changes in prices, retail sales and house price indices, and longer-range trade flows statistics, unemployment and workforce participation data.

This week we saw the release of two of the above indicators: residential property price index and retail sales. The former registered another massive decline, with residential property prices falling 17.4% year on year in January 2012, after posting a 16.7% annual decline in December 2011 and 15.6% decline in November 2011. With Dublin once again leading the trend compared to the rest of the country, there appears to be absolutely no ‘soul-searching’ as house prices continue to drop. House prices, of course, provide a clear signal as to the direction of the domestic investment – and despite all the noises about the vast FDI inflows and foreign buyers ‘kicking tyres’ around empty buildings and sites – this direction is down.

More interesting are the volatile readings from the retail sales data.

The headline indices of retail sales volumes and values for January 2012, released this week were just short of horrific. Year on year, retail sales declined 0.34% in value terms and 0.76% in volume terms. Monthly declines were 3.7% across both value and volume. Relative to peak, overall retail sales are now down 25% in value terms and 21% in volume. January monthly declines in value and volume were the worst since January 2010. Stripping out motor trade, on the annual basis, core retail sales fell 1.94% in value terms and 2.74% in volume terms, although there was a month-on-month rise of 0.3% in value index. Monthly performance in volume of sales was the worst since February 2011.

Looking at the detailed decomposition of sales, out of twelve core Retail Businesses categories reported by CSO, ten have posted annual contractions in January in terms of value of sales. The two categories that posted increases were Fuel (up 5%) and Non-Specialised Stores (ex-Department Stores) (up 1.7%). The former posted a rise due to oil inflation, while the latter represents a small proportion of total retail sales – neither is likely to yield any positive impact on business environment in Ireland. In volume terms, increases in sales were recorded also in just two categories. Non-Specialised Stores sales rose 1.0%, while Pharmaceuticals Medical and Cosmetic Articles rose 1.5% year on year. Overall, only one out of 12 categories of sales posted increases in both value and volume of sales. All discretionary consumption items, including white goods and household maintenance items posted significant, above average declines in a further sign that households are continuing to tighten their belts, cutting out small-scale household investment and durables. The trend direction is broadly in line with November 2011-January 2012 3-months averages, but showing much sharper rates of contraction in demand in January.

The above confirm the broader downward trend in domestic demand that is relatively constant since Q1 2010 and is evident in value and volume indices as well as in total retail sales and core sales. More importantly, all indications are that the trend is likely to persist.

One of the core co-predictors – on average – of the retail sector activity is consumer confidence. Despite a significant jump in January 2012, ESRI consumer confidence indicator continues to bounce along the flat line, with current 6 months average at 56.5 virtually identical to the previous 6 months average and behind 2010-2011 average of 57.3. Based on the latest reading for consumer confidence, the forecast for the next 3 months forward for retail sales is not encouraging with volumes sales staying at the average levels of the previous 6 months and the value of sales being supported at the current levels solely by energy costs inflation.

Lastly, since 2010 I have been publishing an Index of Retail Sector Activity that acts as a strong predictor of the future (3 months ahead) retail sales and is based both on CSO data and ESRI consumer confidence measures, adjusted for income and earnings dynamics. The Index current reading for February-April is indicating that retail sales sector will remain in doldrums for the foreseeable future, posting volume and value activity at below last 6 months and 12 months trends.

Which means that the sector is likely to contribute negatively to unemployment and further undermining already fragile household income dynamics for some of the most at-risk families. During the first half of the crisis, most of jobs destruction in both absolute and relative terms took place in the construction sector, dominated by men. Thus, for example, in 2009 number of women in employment fell 4.2%, while total employment declined 8.1%. By 2010, numbers of women in employment were down 2.8% against 4.2% overall drop in employment. Last year, based on the latest available data, female employment was down 2% while total employment fell 2.5%. In other words, more and more jobs destruction is taking place amongst women, as further confirmed by the latest Live Register statistics also released this week, showing that in February 2012, number of female claimants rose by 3,479 year on year, while the number of male claimants dropped 8,356 over the same period.

The misfortunes of the retail sector are certainly at play in these. Per CSO, female employment in the Wholesale and Retail Trade sector has fallen at more than double the rate of overall retail sector employment declines in 2010 and 2011. Relative to the peak, total female employment is now down 10.2%, while female employment in retail sector is down 17.9%.

Traditionally, acceleration of jobs destruction amongst women is associated with increasing incidences of dual unemployment households. This is further likely to be reinforced by the increasing losses of female jobs in the retail sector, due to overlapping demographics and relative income distributions. Such development, in turn, will put even more pressure on both consumption and investment in the domestic economy.

CHART

Source: CSO and author own calculations

Box-out:

The forthcoming Referendum on the EU Fiscal Compact will undoubtedly open a floodgate of debates concerning the economic, social and political implications of the vote. Yet, it is the economic merits of the treaty that require most of the attention. A recent research paper by Alessandro Piergallini and Giorgio Rodano from the Centre for Economic and International Studies, University of Rome, makes a very strong argument that in the world of distortionary (or in other words progressive) taxation, passive fiscal policies (policies that target constitutionally or legislatively-mandated levels of public debt relative to GDP) are not feasible in the presence of the active monetary polices (policies that focus solely on inflation targeting). In other words, in the real world we live in, the very idea of Fiscal Compact might be incompatible with the idea of pure inflation targeting by the ECB. Which is, of course, rather intuitive. If a country or a currency block were to pre-commit itself to a fixed debt/GDP ratio, then inflation must be allowed to compensate for the fiscal imbalances created in the short run, since levying higher taxation will ultimately lead to economic distortions via household decisions on spending and labour supply. Given that ECB abhors inflation, the Fiscal Compact must either be associated with increasingly less distortionary (less progressive) taxation or with the ECB becoming less of an inflation hawk.

Sunday, February 5, 2012

5/2/2012: Irish Consumer Confidence - a bounce in January?

I have noticed that ESRI and KBC Bank are very enthusiastic about the latest reading for their consumer confidence barometer reading for January 2012. Absent the retail sales data for January, we can only speculate as to what the latest increase means. But here's a somewhat scientific method for doing this.

Chart below shows dynamics in Consumer Confidence index and historical and forecast values for two core retail sales indices. The forecasts are based on trend dynamics for each index from January 2008, accounting for the correlation between Consumer Confidence and specific retail sales index and accounting for the latest reading for Consumer Confidence index.


The chart above shows my own Retail Sector Activity Index with the forecast for January 2012 based on the above estimates shown in the first chart.

Here's what is clear from the above exercise. Assuming the Consumer Confidence index reading for January is to be trusted (see below on that), we can expect:

  • Index of retail sales value to rise 7.4% qoq and 6.3% mom to the level of 101.8 or 4.1% ahead of where the index reading was 12 months ago. This would put the value index at the levels not seen since July 2009.
  • Volume index of retail sales can be expected to rise 5.4% qoq and 3.4% mom. The index reading would reach 104.3 which is 2.6% ahead of where it was 12 months ago and the level not seen since April 2010.
  • Of course, Consumer Confidence index now stands at 56.6 up on 49.2 in December 2011.
  • My Retail Sector Activity Index, consistent with the current reading in the Consumer Confidence index would be around 110.5 - the level that is 1.6% ahead of where it was 3 months ago, 7.4% ahead of the previous month reading and 6.4% ahead of where the index stood 12 months ago. This reading - were it to materialise - will bring my index to the levels unseen since July 2010.
All of this, of course, is rather academic. The problem with the ESRI Consumer Confidence is that it has only weak relationship with both the Value Index of Retail Sales and the Volume Index of Retail Sales, as the charts below illustrates. Please note: this does not mean in any way that Consumer Confidence Index contains little relevant information, just that it is, in itself, a very weak predictor of the retail sales activity.


I wouldn't be holding my breath waiting for a big Retail Sales bounce in January-February this year.

Thursday, December 22, 2011

22/12/2011: Retail Sales for November

Ok, folks, RTE is shouting "Biggest Retail Sales Rise Since March" (see link here) but you do know to turn to this blog to see the real numbers. So here are the updated charts and historical trends and some analysis.

It is worth noting that my Retail Sector Activity Index for October has predicted this uplift:
"A large jump in consumer confidence in October (to 63.7 from September reading of 53.3) is the core driver of improvement in the  overall Index od Retail Sector Activity, which now stands at 102.2 - above the expansion level of 100. This means that we can expect a small uplift in retail sector activity in months ahead, but this uplift can manifest itself through improved volumes of sales (value static, so margins declining) or improved value of sales (inflation) or both (more demand-driven uplift)."
Please note that below analysis exactly confirms the above predictions.

However, this does not mean that I share with the RTE headline excitement about the actual sales indices performance in November 2011. Here's why:

First of all - general retail sales (including motors), seasonally adjusted:

  • Value of retail sales rose from 87.2 in October to 88.2 in November, an increase of 1.1% mom, a drop of 0.68% yoy. History in making? Well, not really - in 2 months of October and November, retail sales rose 1.50%, in 2 months of May-June retail sales value grew 1.25% (statistically indifferent from 1.5% gain in last two months), and in 2 months between February and March they rose 1.26%, which is again identical - statistically-speaking - to the rise in last 2 months. So history is not being made here.
  • Significantly, annual rate of declines has slowed down in November to -0.7%, which is the best reading since June when there was zero change in retail sales year on year, but then, again, in January value of sales was up 4.3% yoy and then in February it was down just -0.2% yoy. Now, again, no historical headlines here.
  • Let's take a look at the trends. At 88.2 current reading is ahead of 3mo MA of 87.4 and 6mo MA of 87.7, but it is below 201 average of 88.86. In other words, current sales are worse than monthly average for 2010. And current sales are slightly ahead of 2011 monthly average to-date of 87.82%. Not that the RTE would bother mentioning that.
  • Relative to the peak, value of retail sales is still down 24.10% in November.
  • In Volume terms, there was a 1.6% monthly rise from 91.9 in October to 93.3 in November. This is statistically insignificant difference too. In 2 months through November, index of the volume of retail sales rose 1.97%, in May-June it was up 2.07% and we do know that it was not exactly boom time on the high street back then.
  • Volume index is now down 0.8% yoy and 19.8% down on peak. 3moMA is at 92.23 and 6mo MA at 92.47. However, 2010 monthly average is at 93.6, which is ahead of November monthly reading. So, as with value index, the 'record sales' in November are lower than the average monthly sales volumes in 2010. 
Charts to illustrate:



Frankly, I am not seeing anything that jumps out on an extraordinary scale. Some uplift, most likely supported by the decline in foreign travel for shopping and by better weather conditions this year than in 2010, but hardly spectacular. Only notable increases yoy are in Non-specialized stores ex-Department Stores (where inflationary pressures drove value up 1.4% while volume was up only 0.5%), Fuel (where inflation was so rampant that value of sales rose 10.3% while volume of sales fell 3.7%) and Electrical goods (where season sales started early and cuts were running deep with value +0.5% and volume up 7.5% yoy). everything else was either down or flat. You tell me if this is something that we can cheer about?

Let's take another look at the pure index numbers: 
  • Value index at 88.2 was the highest reading since June when it stood at 88.8. In last 12 months through November, index was in excess of 88.2 or equal to it on 5 occasions other than November 2011, which makes this month's reading oh, sort-of average.
  • Volume index at 93.3 in November 2011 is the highest since 93.8 in June 2011 and is the 4th highest in the last 12 months - also not exactly a trend-breaking performance.


So adjusting for motors sales, core retail sales indices were:
  • Value of core retail sales rose 1% mom from 94.6 to 95.6 in November. November 2011 reading is 0.1% ahead of November 2010 reading and the current index stands at the 5th highest reading level over the last 12 months.
  • Relative to peak value of core retail sales is down 19.39%. 2010 monthly average reading is 97.57% - ahead of November 2011 reading. More ironically, year-to-date 2011 average monthly reading is 95.62 which is identical to the November 2011 reading.
  • By all possible comparisons, November 2011 reading for the Value of core retail sales (ex-motors) is average.
  • Volume reading reached 100.6 - the first over-100 reading since April 2011. Index is now up 1.8% mom and down -0.8% yoy. This is the set of numbers that excited the RTE the most.
  • Yet, 2010 monthly average reading for this index was 102.7 - above the November 2011 reading. However, importantly, 2011 year-to-date average monthly reading is 99.7 - statistically insignificantly different from November 2011, but still below November reading in actual terms.
  • Still, November 2011 is worse than the average month of 2010. Not exactly a strong performance.

Charts to illustrate:




Ok, let's summarize the above: supposedly we had an exciting retail sales month in November. Yet, by all measures CSO reports, November performance this year was worse than average monthly performance in 2010, and by 3 out of 4 measures reported by CSO, November was worse than the average month in 11 months from January 2011 through November 2011.

Oh, and as an aside, here are the comparatives in retail sales volumes across Ireland, EU17 and EU27 (data reported with a monthly lag here, so latest we have is for October sales):

Monday, November 28, 2011

29/11/2011: Retail Sales for October: Ireland


Irish retail sales continue on downward trend, with no respite.  I will be updating my exclusive Retail Sector Activity Index in the follow up post (so stay tuned), but here are the core headlines:
  • The volume of retail sales index rose by 0.1% in October 2011 mom but is down 3.8% yoy. The volume of sales is now down 21.67% on peak. The index reading of 91.1 in October compares against 91.3 3mo AM and 92.1 6mo MA. In 2010 index average was 93.3 and 2011 to-date average is 92.0.
  • There was no change in the value of retail sales on a monthly basis, however the annual change was -3.7%. The value index is now 25.6% below its peak. 3mo MA is at 86.7 against current reading of 86.5 and 6mo MA is at 87.5. 2010 annual average is 88.8 against 2011 average to-date of 87.7.

Charts below illustrate:





Focusing on core sales (ex-Motors):
  • The volume of retail sales decreased by 0.2% in October 2011 mom, while there was an annual decrease of 3.6%. Core retail sales are now down 16.1% on the peak and 3mo MA is at 98.4 against October reading of 98.2, 6mo MA is at 98.8 and 2010 average is at 102.25 against 2011 average to-date of 99.5.
  • There was a monthly decrease of 0.1% in the value of core retail sales and an annual decrease of 2.8%, with the value index now 20.6% below the peak. 3mo MA is 94.3, against current October reading of 94.2, and 6mo MA is 94.7. 2010 annual average is 97.6 against 2011 average to-date of 95.5.
Charts below illustrate:



So we are now in month 49 of core retail sales below pre-crisis peaks in both value and volume terms and no sustained bounce in sight. One can only wonder how on earth we still have functioning retailers left.


In October, Books, Newspapers & Stationery (-2.8%), Department Stores (-1.9%) and Electrical Goods (-1.7%) were amongst the categories that showed month-on-month decreases in the volume of retail sales. But have a closer look: seasonally adjusted sales excluding motors, fuel, bars and food are down 1.0% mom and 6.6% yoy in value and down 0.8% mom and 5.3% yoy in volume. So, basically, everything we buy that cannot be substituted for purchases in the Northern Ireland (though motors and food can, with some caveats) has tanked.

And in case you wondered: here's a chart showing annual rates of change in volume of sales for Ireland v EU27 and EA17
Clearly, things are turning around...

Friday, October 28, 2011

28/10/2011: Retail Sales for September

Retail sales for September came in with a major disappointment with a drop of 0.8% in Volume and an annual decline of 2.9%. The Value of retail sales fell 0.6% mom and declined 3.3% yoy. Given catastrophic collapse of the retail sales through the crisis to-date, the latest figures are grim.
Value of retail sales (seasonally adjusted) is now below 3mo average of 87 (September reading is 86.4) and below 6mo average of 87.6. In comparison, 2010 annual average is 88.8 and 2011 average to-date is 87.7. Volume of retail sales is now running at 91.0 against 3mo average of 91.7 and 6mo average of 92.2. 2010 annual average is 93.3 against 2011 average to-date of 92.1. Things are bleak across the board.

Relative to peak (chart below), Value of retail sales is now down 25.6% and Volume is down 21.2%.

Ex-motors - core - retail sales declined 0.2% mom and fell 3.4% yoy in Volume, in Value there was a monthly decrease of 0.1% and an annual decrease of 2.4%. Relative to peak, core sales are now down 20.4% in Value and 15.0% in Volume. 3mo average for Value of core sales is now at 94.6 against September reading of 94.3 and 2010 average is at 97.6 against 2011 to-date average of 95.7. For Volume, 3mo average is 98.7 against the current reading of 98.4 and 2010 average is 102.3 against 2011 to-date average of 99.7.

Quarterly series movements are showing substantial strain on retail sales, as detailed in the charts below.


Per CSO: "The only categories that showed month-on-month increases were Electrical Goods
(+2.7%), Department Stores (+0.3%), Oher Retail Sales (+0.5%) and Non Specialised Stores (+0.2%) in the volume of retail sales. Furniture & Lighting (-4.2%), Motor Trades (-3.4%) and Food Beverages and Tobacco (-2.8%) were amongst the categories that showed month-on-month decreases in the volume of retail sales."

Other revealing features included:
  • Fuel sales were up 1.7% yoy in September in Value, but down 9.6% in Volume, reflective of deep price inflation and continued contraction in demand
  • Pharmaceutical Medical and Cosmetic Articles sales down 8.9% yoy in both Volume and Value
  • Clothing, Footware and Textiles down 4.9% in Value and 5.3% in Volume yoy
  • Furniture & Lighting down a massive 15.1% in Value and 11.7% in Volume yoy
  • Overall, in terms of Value of sales only 2 categories of sales posted yoy increases in September: Non-Specialized Stores (ex Department Stores) and Fuel. In terms of Volume only electrical goods (+3.2%) posted a yoy increase.
  • In August 2011 (latest data available) Ireland recorded 6th largest yoy contraction in retail sales in EU27. In July 2011 we were the 8th worst performing economy in terms of retail sales.

But fear not, allegedly, exports of Viagra etc are going to replace all the jobs being lost in the retail sector as soon as we've turned another corner.

Wednesday, September 28, 2011

28/09/2011: Retail Sales for August - a nasty surprise.

After showing the signs of some stabilization in quarterly data (Q2 2011 index of retail sales by value was up to 88.3 from 88.0 in Q1 2011 and volume of sales index went up from 91.8 in Q1 to 92.9 in Q2), the latest data has thrown a nasty surprise to the downside in retail sales activity in August.

Here are the core highlights:
  • Value of retail sales has fallen 0.8% mom in August to 87.1, down from 87.8 in July. In two months since the end of Q2 2011, the value of retail sales (seasonally adjusted) has declined from 88.7 to 87.1, more than erasing the gains recorded in May and June this year. Annual rate of decline in August was 3.1%, compared to the annual rate of decline of -1% in July.
  • August value index posted the sharpest monthly contraction in 4 months, ditto for annual rate of decline. Comparable monthly peak took place in August 2007 and we are now 25.04% down on that in terms of value index. 3mo-MA is now at 87.9, down from the 6mo-MA of 88.0. 2010 annual average for the index was 88.8 and 2011 average to-date 88.0, which means that 3mo- and 6mo- and year-to-date performance through august is worse than 2010 annual average.
  • Volume index (seasonally adjusted) also fell, declining from 92.4 in July to 92 in August, the rate of decline of 0.4% mom and 3.6% yoy. This is sharpest rate of contraction (yoy terms) since April 2011.
  • 3m0-MA is now at 92.7 against 6mo MA of 92.6 and these are both below 93.3 annual average for 2010. Annual average for 2011 to-date is 92.3.
In summary, folks - the battered sector is taking even more water!

Relative to peak things are even bleaker:

  • Value index is now at 73.0% relative to peak down from 73.6% in July. August reading is the lowest since January 2010.
  • Volume index is at 79.1% of the peak and this is down from 79.45% in July. August reading is the lowest since April 2011.

Ex-motors sales:

  • Value of retail sales ex-motors in August stood at 94.4, down from 95.2 in July, a decline of 0.9% mom reversing 0.4% mom increase in July, the sales are now down 2.8% yoy against 1.5% decline yoy in July. 3mo-MA at 94.8 and 6mo-MA at 95.5, as well as 2011 average to-date of 95.9 are all below 2010 annual average of 97.6.
  • Volume of retail sales ex-motors is down to 98.7 in August, 0.5% below the 99.2 reading in July. 3mo-MA of 99.1, 6mo-MA at 99.5 and 2011 average to-date at 100.0 are all below 2010 average of 102.3.
Relative to peak:

  • Value of core sales is now at 79.6% of the historical peak having risen to 80.3% of the peak back in July. August reading marks the lowest point in the series relative to peak.
  • Volume of core sales is at 84.4 relative to historical peak, also the lowest point in the series.

According to CSO:
  • Electrical Goods (+2.1%) was the only category that showed year-on-year increases in the volume of retail sales this month. Sales fell in value 5.0% yoy as deflation continued in the sub-sector.
  • Books, Newspapers and Stationery (-13.3% both in volume and in value), Pharmaceuticals Medical & Cosmetic Articles (-10.4% in volume and -9.8% in value) and Furniture & Lighting (-9.5% in volume and- 13.1% in value) were amongst the categories that showed year-on-year decreases this month.
  • Fuel sales have declined 8.2% yoy in volume, but rose 3.1% in value as inflation bit harder into the pockets of consumers cutting back on fuel purchases.
  • Hardware, Pains & Glass sales are down -6.3% in volume and -6.8% in value
  • Motor trades are down 5.7% yoy in August in value and 2.6% in volume
  • Bars sales are down 7.1% in volume and 7.3% in value.
Irish retail sales decline in volume terms was the seventh largest in EU27. Euro area as a whole experienced a decline of 0.2% in the volume of retail sales. More on this in upcoming separate post.

Monday, August 29, 2011

29/08/2011: Retail Sales for July - a mixed bag swinging in the headwinds

The volume of retail sales in Ireland declined by 0.6% in July 2011 yoy and there was a monthly change of -0.5%. The value of retail sales decreased by 0.5% yoy and there was a month-on-month change of -0.4%.
  • Current value of sales index reading is 88.7, down from 89.1 in June and below the 3mo running average of 88.8. The index is still ahead of the January 2011-to-date average of 88.3.
  • Value of sales index is now 25.65% below its peak in February 2008.
  • Value of retail sales index now reads 93.2, down from 93.7 in June. The index is now slightly below its 3mo running average of 93.3 but slightly ahead of 6mo running average of 92.8. The volume index average for January 2011-to-date is 92.3.
  • Volume of retail sales is now down 19.86% on its peak attained back in October 2007.

If Motor Trades are excluded, the volume of core retail sales fell by 2.3% in July 2011 against July 2010, while there was a monthly increase in sales volumes of 0.5%. There was an annual decrease of 1.2% in the value of retail sales and a monthly increase of 0.8%.
  • Value of core retail sales now stands at 95.7, up from 94.9 a month ago and ahead of 3mo running average of 95.3, but still below 6mo running average of 95.9. In comparison, 2010 average was 97.6 and 2011 running average to-date is 96.2.
  • Core retail sales in value are now 19.3% below their December 2007 peak.
  • Volume of core retail sales is now reading 99.1, up from 98.6 a month ago, and against 98.8 average for the 3mo and 6mo running average of 99.3. 2010 annual average is 102.3, while January 2011-to-date average is 99.5.
  • Volume of retail sales is now 15.3% below its November 2007 peak.

In July, Motor Trades (+7.1%) and Non-Specialised Stores (+0.4%) were the only two
categories that showed year-on-year increases in the volume of retail sales. Largest yoy drops were posted by Books, Newspapers and Stationery (-9.5%), Other Retail Sales (-6.9%) and
Pharmaceuticals Medical & Cosmetic Articles (-6.8%) in the volume of retail sales.

A follow up post will update on the data for consumer confidence and links to retail sales data.

Saturday, July 30, 2011

30/07/2011: Detailed analysis of Retail Sales figures for June 2011

The volume of retail sales rose +0.2% in June 2011 compared with June 2010 and +1.1% mom. The 3mo average for the volume index is now at 93.07, while the 6 mo average is 92.3. Both below the current monthly reading. June reading marks the second consecutive monthly increase in the index. 2010 average is 93.3, while 2011 average to-date is 92.3, behind that of 2010.

The value of retail sales rose +0.4% in June 2011 when compared with June 2010 and there was a month-on-month increase of +0.7%. The value index now stands at 89.4 (marking the second consecutive month of increases) against 3mo average of 88.7 and 6mo average of 88.3. Compared to 2010 average of 88.9, the 2011 average to-date is now at 88.3.


Thus, the volume of retail sales in June 2011 stood at 94.1 down 16.73% relative to the peak. Current monthly reading for the value index is 23.59% below the peak for the series.
Couple of charts for quarterly changes:

Of course, the problem with the above data is that it is distorted by the motor sales volumes and values, especially pronounced due to the expiry of the Government incentive scheme for new motors purchases in June 2011. Hence, ex-motors data paints a dramatically different picture of continued deterioration in retail sales.

Excluding Motor Trades, the volume of retail sales fell 4.2% in June 2011 when compared with June 2010, while there was a monthly decrease of 0.1%. Thus, June marked a 5th consecutive month of declines in the colume of retail sales ex-motors. The index is now at 98.2, below 3mo average of 98.5 and 6mo average of 99.45 and well below 2010 average of 102.2.

Ex-Motor Trades there was an annual decrease of 3.2% in the value of retail sales and a
monthly decrease of 0.5%. Index reading of 94.6 in June 2011 stands below 3mo average of 95.3 and 6mo average of 96.2 as well as 2010 annual average of 97.6. The index has now declined (mom) for 3 months in a row.

In year on year terms, volume index retail sales ex-motors are now down 14 moths in a row and in terms of value index for 36 months in a row. In 2010, index of volume of retail sales ex-motors posted an average monthly decline of 0.28%, while in 2011 to-date the same figure is 0.03, while the latest 3mo average is 0.67% decline. For value of sales ex-motors, the average monthly decline was 0.24% in 2010, against 0.08% average monthly decline in 2011 to-date and 0.8% decline in 3 months to-date. So clearly, last 3 months suggest increased rate of deterioration on both 2010 and H1 2011 averages.


Relative to peak, the volume of retail sales ex-motors has now fallen 13.33%, while the value of retail sales ex-motors is down 19.42%. Both series continue their downward trajectory.


So overall, in June 2011, Motor Trades were up +21.9% yoy in volume. Alongside motor sales, sales of Electrical Goods (+5.2%) and Furniture & Lighting (+2.6%) were the only three categories that showed year-on-year increases in the volume of retail sales this month. Fuel (-12.0%), Hardware Paints & Glass (-10.4%) and Other Retail Sales (-8.1%) were amongst the ten categories out of 14 total that showed year-on-year decreases in the volume of retail sales this month.

In terms of value of retail sales, Motor Trades posted an annual increase of 18.3% - the only category of sales that posted an annual increase in value. Hardware & Paints (-10.9% yoy), Other Retail Sales (-6.0%), Bars (-5.8%) were the categories with largest (above 5%) declines in the value. Overall, 13 categories out of total 14 have posted yoy declines in value of retail sales.

My previous analysis of the Consumer Confidence indicator from the ESRI and high level dynamics in retail sales (see link here) shows that these trends toward continued pressures in the retail sector are expected to continue over coming months.